Builder basket
Contract-defined cumulative capacity for permitted uses such as investments or distributions. It may build from specified income and other sources, less usage and other deductions, subject to conditions.
Builder basket in round numbers
Hypothetical: a basket starts at US$10m and adds 50% of qualifying net income. Assume US$10m of qualifying income in each of three years, no prior usage, no other additions or deductions, and all eligibility conditions satisfied. Capacity after year three is US$10m + 3 × 50% × US$10m = US$25m. Use remains subject to the agreement’s applicable conditions.
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| Stage | Qualifying annual income | Addition | Cumulative capacity |
|---|---|---|---|
| Start | Not applicable | 10 initial | 10 |
| Year 1 | 10 | 5 | 15 |
| Year 2 | 10 | 5 | 20 |
| Year 3 | 10 | 5 | 25 |
Source: Filed credit agreement: available-amount calculation and conditions.
Terms Related to Builder basket
Covenant · Basket stacking · Amend-and-pretend · Open-market-purchase exception · All of the glossary